#StopLossStrategies A stop-loss strategy is a crucial risk management tool in trading and investing. It involves setting a predetermined price level at which a position will be automatically closed to limit potential losses. This acts as a safety net, preventing significant capital erosion if the market moves against the trader's position.

Several stop-loss strategies exist, including fixed percentage stops, where a certain percentage below the entry price triggers the exit, and volatility-based stops, which consider the market's fluctuations. Another approach uses technical levels like support and resistance to place stop-loss orders. Trailing stops are dynamic, adjusting the stop price as the position moves favorably, helping to lock in profits.

Implementing a well-defined stop-loss strategy is vital for protecting capital and maintaining discipline in trading. It helps remove emotional decision-making during volatile market conditions and ensures a more controlled approach to risk.